) recently reported financial results for the first half of 2014
(ended Jun 30, 2014). Earnings per share, excluding restructuring
and impairment charges, came in at $15.60 (or $3.12 per ADR), down
2.0% from $15.92 reported in the first half of 2013.
In the reported half year, sales climbed 1% year over year to
$8,508 million year over year. At Constant Exchange Rate (CER),
revenues increased 4% backed by price and volume gains.
EAME (Europe, Africa, Middle East)
witnessed a healthy performance with sales growing 7%, 11% and 10%
year over year, to $3.3 billion, $1.3 billion and $1.1 billion,
respectively, on a CER basis. However, revenues declined 7% in
to $2.4 billion and remained flat in
Lawn and Garden
segment at $364 million.
Gross profit margin in the reported period increased 100 basis
points (bps) year over year to 49.6%, on a CER basis. Earnings
before interest, tax, depreciation and amortization (EBITDA) margin
was 26.6%, up 60 bps year over year, on a CER basis.
Adjusted operating margin in the EAME segment decreased 190 bps
year over year to 38.9%, while the same declined 560 bps year over
year to 29.2% in the North America segment. Lawn and Garden
segment's adjusted operating income fell 270 bps year over year to
Also, adjusted operating profit in Latin America increased 90
bps year over year to 17.4%. Adjusted operating income for Asia
Pacific segment improved 20 bps to 28.0%.
Balance Sheet/Cash Flow
As of Jun 30, 2014, Syngenta had cash and cash equivalents of
$865.0 million, against $902.0 million on Dec 31, 2013. Financial
debt and other non-current liabilities were $3.0 billion, up from
$1.8 billion in the preceding half year.
In the first six months of 2014, Syngenta generated cash flow
from operating activities of $195.0 million, compared with $68.0
million cash used in the last-year comparable period. Capital
expenditure amounted to $268.0 million, up from $220.0 million
incurred in six months ended Jun 30, 2013.
During the reported period, Syngenta paid dividends totaling
$1.0 billion, along with share repurchases worth $48.0 million.
In the second half of 2014, management expects sales growth on
the back of increased demand in the Latin America segment. On a CER
basis, the company expects to witness integrated sales growth of 6%
year over year. Free cash flow before acquisitions is expected to
reach $1.3 billion in 2014.
Other Stocks to Consider
With a market capitalization of $32.9 billion, Syngenta holds a
Zacks Rank #4 (Sell). Some better-ranked stocks in the industry
Yara International ASA
Chemical & Mining Co. of Chile Inc.
). While Yara International sports a Zacks Rank #1 (Strong Buy),
Limoneira and Chemical & Mining Co. hold a Zacks Rank #2 (Buy)
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